Skip to content

Reality Check: Economic Slowdown May Undo China’s Climate Plans

Bloomberg News

A slowing Chinese economy threatens to undermine the deadline outlined last week by President Xi Jinping to introduce a nationwide carbon market by 2017.

Companies ranging from coal-fired power plant operators to cement producers and oil and gas companies, faced with struggles to stay afloat, could be reluctant to participate in the cap-and-trade system the Chinese government has vowed to roll out on a national level, according to Tian Miao, an analyst at North Square Blue Oak Ltd., a London-based researcher.

“With slowing energy demand in a slowing economy, the last thing these companies want is an extra cost associated with a carbon emissions commitment,” Tian said by phone from Beijing. “They’ve got enough to worry about already. The launch of a nationwide market at a time when they are having a difficult time to survive has the risk of not having enthusiastic participants at first.”

Xi’s national market would open in 2017, covering industries including power generation and iron, steel and cement makers. China already has seven pilot programs running around the country.

Full story